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Originally Posted by aceventura3
On one level I have absolutely no idea where to start. US policy and regulations affect demand. US policy and regulation affect supply. The US is the largest consumer of oil in the world. US policy and regulation has a material impact on where and how oil resources are developed. The US is the engine that drives the oil market. I am not saying our policies and regulations are a failure, I just think it important that we know and understand the costs.
The current US posture of de-valuing the dollar is having a material impact on the price of oil. All these issues come back to US policy and regulation
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I cannot even begin to speculate what proportion of the oil price is influenced by American policy alone. All I know is that it's doubtful to be as high as 50%. There are far too many global factors--political, technological, geographic, and economic
global factors. The American economy is big, but it's not
that big.
The European Union and China combined consume nearly as much oil at America. Add everyone else into the mix, and you'll find America consumes only a quarter of the oil consumed globally. But this is shifting, of course, as we know about the booming Asian countries.
Athabasca Oil Sands: Geopolitical importance
The Athabasca Oil Sands are now featured prominently in international trade talks, with energy rivals China and the United States negotiating with Canada for a bigger share of the oil sands' rapidly increasing output. Output at the oil sands is expected to quadruple between 2005 and 2015, reaching 4 million bbl/day, increasing their political and economic importance. Although most of the oil sands production is currently exported to the United States, that could change.
An agreement has been signed between PetroChina and Enbridge to build a 400,000 barrel-per-day pipeline from Edmonton, Alberta to the west-coast port of Kitimat, British Columbia to export synthetic crude oil from the oil sands to China and elsewhere in the Pacific, plus a 150,000-barrel-per-day pipeline running the other way to import condensate to dilute the bitumen so it will flow. Sinopec, China's largest refining and chemical company, and China National Petroleum Corporation have bought or are planning to buy shares in major oil sands development.
If anything, China will be taking over much of the influence of the price of oil. Their economy depends on it. They are facing a huge phase of expansion, and with that you have an influx of wealth (both domestic and foreign) to be used to bolster the economy. The American economy is contracting right now, and China will pick up any slack left by it and then some. Compared to 1999,
China is spending 35 times more on crude oil. They have a huge population and it's modernizing. Oil imports are expected to triple by 2030.
How do you think this affects oil prices?
Shall we look to India next?